Sunday, May 13, 2012

Advice for the Recent Grad: Low Salary Genre

Ahhhhh. The recent grad. Time for advice: get a no-fee credit card, contribute to your 401k, get a Roth IRA, blahblahblah. But what about the recent grad of the low salary type? the Vista volunteer who will be making $1000/month at a worthy endeavor? (In the meanwhile studying for MCATS)
I already gave the grad two books.
And I say it's also time to learn basic frugal skills, which are a necessity when you have little and allow you to get more out of your money even if you are a well-paid physician. The grad asked me to help him save money on basic household expenses. To start, I say: buy a big bag of dried beans. Then buy a big bag of rice. Both are investments that will pay off.
What would you advise?

Great topic and of interest to me, as my son is graduating this weekend with a BA in classics. There is no high-salary job waiting for him. I would suggest thinking about transportation. Do you need a car? If a car is a must, can you get along with a cheap old beater? I'm always surprised when I hear of kids who buy a brand-new car right after graduation, saddling themselves with car payments in addition to student loan papyments. My son can not afford a car. He will be using public transportation and a bicycle. No car payment, no insurance, no gas.

I was a low-income grad. Thinking back on my salary, I'm amazed that I was able to survive on it.

I learned 3-4 basic recipes, mostly soups and stews cooked in a large pot, which would provide 3 or more days' worth of meals. I did as you suggested, bought rice, pasta, and beans in bulk, and then supplemented with whatever fresh produce I could afford.

Another thing which has always saved me money is that I've always lived very close to my work and I have always chosen to live in inexpensive but safe neighborhoods.